Three Snowhill

Sitting in the centre of the Birmingham’s Business District and minutes walk from Snowhill Train Station, Three Snowhill is a landmark office building which marks the final build of the hugely successful Snowhill Estate.

What we do

Business Birmingham aims to take the stress out of relocation and expansion projects for businesses coming into the city through tailored support and expertise. We provide a variety of free-of-charge services from property visits to PR.

West Midlands has another outstanding year of foreign investment

The West Midlands secured a record 111 foreign direct investment (FDI) projects in 2016, with over 50% coming from the manufacturing sector. This follows a landmark year in 2015 when a surge in FDI saw 92 projects locating in the region and the highest number recorded in a decade.

According to EY’s latest annual Attractiveness Report, in 2016 the majority of UK regions saw an increase in projects, with just four seeing a decline when compared with the previous year: Wales, the North East, North West and South West of England. However, investors predict a decline in the UK’s future attractiveness as a destination for foreign investment.

Birmingham continued to dominate the West Midlands region in terms of attracting FDI, by securing 36 projects in 2016 – up from 24 in 2015. Coventry and Solihull followed with 15 and six projects respectively.

50% of the West Midlands’ total FDI projects were from the manufacturing sector and strong growth was seen from the financial and business services sector which secured 20% of the total number of projects (23) in 2016.

Sara Fowler, senior partner at EY in the Midlands said:

“It’s been another outstanding year for inward investment, with the West Midlands now the third best performing UK region for attracting FDI. The implementation of the Midlands Engine strategy should serve to attract more businesses and skilled people to the region, which in turn will boost employment and productivity.

“With the appointment of Andy Street as Mayor of the West Midlands Combined Authority to head up our regional growth strategy, and the creation of the West Midlands Growth Company to promote our region on a global stage, we’re looking for these authorities to champion the Midlands Engine to ensure it remains attractive, competitive and connected.”

The majority of investment in the region originated from Europe, with 61 projects coming from European countries. On an individual country basis, the USA was the biggest investor in the West Midlands with 23 projects, followed by Germany with 21. In total, the FDI secured in the West Midlands was generated from 26 different countries across the globe.

The success of the ‘super regions’
London remained the UK’s dominant location for FDI, followed by Scotland, which maintained its second place. The ‘super regions’, the Midlands Engine and the Northern Powerhouse, continued to do well attracting roughly double the number of projects they secured at the beginning of the last decade.

Sara Fowler adds:

“Overall, the regional FDI figures for 2016 suggest that the strong ‘super regions’ are thriving whilst more geographically peripheral regions – for instance Wales, the North East, North West and South West of England – are slipping behind. Finding ways to share the benefits of FDI more evenly across the country is a critical challenge that future policy needs to address.”

Brexit impact
53% of all FDI projects in the West Midlands region were announced before the EU Referendum vote in June 2016, with 46% announced after this date.
Global investors had mixed views when asked about the future attractiveness of the UK. 32% of respondents, surveyed between March and April 2017, say they expect the UK’s attractiveness to FDI to improve over the coming three years, while 31% expect it to decline. Both figures are significantly worse than recorded long-term averages of 53% and 8% respectively. In fact, since March 2016 the share of investors with a negative view of the UK’s medium term prospects for FDI have almost doubled.

Sara Fowler comments:

“The research suggests that the EU Referendum vote and its aftermath may be having an influence on global perceptions of the UK’s medium to long-term attractiveness. Western European investors are twice as negative as Asian and North American investors.

“Decisions on the majority of investments made in 2016 would have been made up to three years ago, which helps to explain the UK’s solid performance last year, but signs of a slowdown are on the horizon.”

9% of investors surveyed said leaving the European Single Market will prompt them to change their investment plans or re-locate from the UK to Europe in the next three years.

Time to act
The UK economy has performed well after the EU Referendum vote and the outlook for FDI remains strong in the short-term. However, there are a number of indicators suggesting that the outlook for the UK is likely to be challenging and our UK investment strategy needs to move quickly to position for future success.

Sara said:

“For the West Midlands there are grounds for optimism; we have a solid base to build from, with globally renowned strengths in advanced manufacturing and emerging strengths in sectors such as creative, digital and life sciences. A rapid response and clear strategy will help strengthen our leading position for inward investment from all parts of the globe,”